What do I do if my insurer will not cover the cost of a claim that I have already paid for?

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What do I do if my insurer will not cover the cost of a claim that I have already paid for?

Our tree fell in our driveway, blocking us in. We had to have it removed but now the insurance says the company charged too much and they don’t want to pay it. Are they required to cover that? Our policy says it covers removal of tree and debris if the tree falls in our driveway. We got 2 estimates, both about the same, and went with the cheapest. The insurance company is saying it’s too much and they don’t want to pay it all. I have already written a check to cover the bill.

Asked on June 6, 2012 under Insurance Law, Georgia

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

An insurer is normally obligated to pay the "reasonable cost" of a service, so if the cost you were charged is "reasonable," they should be paying it; if, however, if it is significantly more than the norm or average (even if it was the lower of the two estimates you received), the insurer may have good grounds to pay the excess--the amount over the reasonable cost.

Also, an insurance policy is a contract. Like any other contract, the parties are bound by terms. If the policy required you to get pre-approval of the cost, to use a contractor selected or approved by the insurer, etc. and you failed to do so, the insurer would have grounds to avoid payment.

If you believe that under the terms of your policy (double check the terms; the specific language of the policy is critical), you should be paid more and cannot work that out voluntarily with the insurer, you could sue the insurer for breach of contract, to enforce your rights under the policy.


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